Success in business is all about negotiating challenges deftly, which is something Roshan Withanage, the Managing Director of CJ International – Bangladesh, head of the Swedish buying house, has been doing with aplomb for long to help the Swedish company stand out amongst the hordes of buying entities that dot the country’s landscape today.
Starting operations in Bangladesh in 2006, CJ International’s mainstay as far as sourcing is concerned, was home textiles. But that was only till Pakistan started enjoying the GSP facility, which ensured a shift of business (home textiles) from Bangladesh to Pakistan. That CJ International owns an office in Pakistan helped it to deal with this situation effectively. Besides Pakistan, CJ International also has offices in India, Bangladesh, China and Hong Kong in addition to its partners in Latvia, Estonia and Thailand.
“There has been a lot of change in the sourcing pattern over the years. Earlier home textiles accounted for almost 60 per cent of our business from Bangladesh. But today it’s 10 per cent of the total business,” explains the MD of CJ International, who adapted well to the changing dynamics and shifted focus to other product categories that have good demands in the markets that the buying house operates in.
Working predominantly with Scandinavia, sweater eventually emerged as the much sought after product accounting for almost half of CJ International’s total business from Bangladesh, while the remaining 40% is shared by knit and woven products and 10 per cent by home textiles (bath robes, towel, etc).
“There is round the year demand for sweaters. During winter, the demand is more for sweaters in heavy gauge while summer and autumn pushes up requirements in lighter gauges,” Roshan explains, adding, “We cater to many big names in Scandinavia including Gina Tricot (Swedish retailer), whose sourcing in Bangladesh is primarily dependent on us. We source everything that is cotton-based across product categories. However, in terms of volume, sweater is still the biggest, followed by T-shirts, then denims, shirts, etc. What we do not ship from here are synthetic items like poplin, georgettes, etc, which are still at a very infant stage in this country”.
CJ International’s average FOB of a pair of denim (ladies) is around US $ 8, T-shirt around US $ 3 and sweater is around US $ 8.
This continuous order flow in sweaters has helped Roshan establish a very good control in all the three sweater manufacturing units (in which the buying houses place their order for woollens) as almost 70 per cent of their total capacities are booked by CJ International throughout the year. “Keeping the number of factories limited and sharing a long-standing relationship helps build the trust factor. In the process, we have aided many factories develop their standards by helping them improve in various aspects,” elucidates Roshan, underlining that it is the very same principle that he applies to other factories for the other product categories.
Despite having a factory base of over 20, CJ International primarily works with only 11. “This is basically to increase order volumes per factory, become a big player in each of them and ensure better quality, and enhance social and environmental compliances,” explains Roshan.
Taking pride in CJ International’s philosophy of acting as clients’ ‘eyes and ears’ and operating as their back office, Roshan’s next target is to cover Europe and Australia in terms of market.
“Apart from Scandinavia, we have running orders from France, Germany and Australia and now we are looking at Poland and Russia also,” he maintains. In Europe, Germany is high up in Roshan’s estimates in terms of potentials, who goes on to add further, “Germans have more dispensable income compared to many other countries in Europe while at the same time German market is also very price-sensitive.”
The United Kingdom has also been a preferred market for CJ International for long. However, with the British deciding to part ways with the European Union, things have changed considerably now, Roshan feels. “The effect of Brexit has been across geographical locations. Besides EU countries and UK, it has differently impacted the manufacturing destinations in other places,” Roshan underlines. British Pound and Euro losing value in comparison to US Dollar have had larger ramifications for the Bangladesh apparel industry in particular as it deals in US Dollars.
“Bangladesh in a way has become expensive for UK as well as other EU nations to do business with. As a result, manufacturers and exporters have to cut prices and lose margins to continue being in the business,” Roshan reveals. According to him, if Brexit proved somewhat ominous for garment exporters in Bangladesh, it was rather the contrary for Turkey (which deals in Euro).
Being the one who helped develop the Bangladesh operations of CJ International, which now contributes roughly US $ 50 million in the company’s total yearly turnover of US $ 100 million, Roshan is not the one to give up on challenges. He is therefore now looking at expanding in USA, where the company already ships caps and few other items to a select clientele.
Well-equipped with a design studio in Sweden, in-house product development teams (both for design and yarn development) and a testing lab (employing a full-time technician and complete set of equipment including an International Lab Standard washer, a dryer, a GSM cutter and GSM weighing machines among others) and it’s very own knitting factory, Young 4ever Textiles Limited (specialized in all kinds of knitted products with production capacity of over 400,000 pieces per month) takes care of the clients’ diverse requirements. This makes Roshan more than confident about CJ International’s prospects in the US.
“We have a winning combination of Swedish, Bangladeshi and Sri Lankan team that brings the technical expertise, transparency and commitment much needed in this kind of operation. Besides, we also have a strong merchandising division and a Quality Assurance department, which visits each supplier almost every day to ensure that the buyers’ requirements in quality and on-time delivery are maintained. To aid our teams, we also have an in-house lab that checks all goods at least three times per production cycle in addition to any buyer-specific requirements,” wraps up Roshan, assuring a full package for all the prospective clients.
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